Spirit Airlines Eliminates Change and Cancellation Fees, Following Frontier’s Lead

Spirit Airlines has announced that it is eliminating both change and cancellation fees, following a similar move by Frontier Airlines. This comes as part of a larger strategy overhaul for the country’s biggest discount carriers.

Previously, Spirit Airlines charged customers between $69 and $119 for ticket changes and cancellations, depending on how close to departure the change was made. However, with the new policy, these fees will no longer be applicable to any guest. Spirit Airlines stated that this new policy is one of the best in the industry and that they have other enhancements in the works.

This change in policy reflects a shift in the pricing approach of budget airlines. Traditionally, these airlines attracted customers with low base fares and then added on fees for additional services such as advanced seating assignments and cabin baggage. In fact, ancillary revenue from these add-on fees often surpassed the ticket prices themselves. However, with the evolving demand and competitive environment, Spirit Airlines recognizes the need to change with the times.

Spirit’s Chief Commercial Officer, Matt Klein, acknowledged this need for change during an earnings call earlier this month. He stated that they will continue to test out new merchandising strategies that will change their approach to revenue generation.

Spirit Airlines and Frontier Airlines are both striving to return to profitability after the impact of the Covid-19 pandemic. In contrast, larger airlines that offer both basic fares and international networks have been able to post profits. During the pandemic, many of these larger rivals, including Delta, American, Alaska, and United, eliminated change fees, except for the cheapest tickets. Southwest Airlines does not charge customers a flight-change fee.

In addition to eliminating change fees, Frontier Airlines has also announced that they will start offering bundled packages that include add-on options such as early boarding and checked baggage. Similarly, Spirit Airlines is offering bundled packages with varying prices that include perks like checked bags.

It is worth noting that President Joe Biden and the Department of Transportation have been cracking down on what they consider “junk fees.” In line with this effort, the DOT issued a new rule requiring airlines to be transparent about add-on fees, like those for checked or carry-on baggage. While this rule was challenged by several airlines, Spirit Airlines stated that the end of cancellation fees is not related to these new rules.

The Biden administration has also recently implemented a new rule requiring airlines to provide automatic cash refunds for cancellations, rather than only in response to a customer’s request.

Overall, the elimination of change and cancellation fees by Spirit Airlines reflects a larger shift in the industry. Budget airlines are reevaluating their pricing strategies and looking for new ways to generate revenue. The moves by Spirit and Frontier are aimed at attracting more customers and returning to profitability after a challenging period. With the Biden administration cracking down on additional fees, transparency and customer-friendly policies are becoming increasingly important in the airline industry.